Unassociated Document


    EMPLOYMENT
AGREEMENT

    


    THIS
AGREEMENT is made and entered into this 24th day of November, 2009, by and
between HYPERDYNAMICS CORPORATION, a Delaware corporation (the "Company"), and
William A. Young ("Employee").

    


    WITNESSETH:

    


            WHEREAS,
Employee and the Company deem it to be in their respective best interests to
enter into an agreement providing for the Company's employment of Employee
pursuant to the terms herein stated;

    


    NOW, THEREFORE, in consideration of
the premises and the mutual promises and agreements contained herein, it is
hereby agreed as follows:

    


            1.     Effective
Date. This Agreement shall be effective on the 7th day of
December, 2009, which date shall be referred to herein as the "Effective
Date".

    


            2.     Position
and Duties.

    


                   (a)
Henceforth, the Company hereby employs Employee as its Executive Vice President
Commercial Affairs, pursuant to the terms of this Agreement commencing as of the
Effective Date for the "Term of Employment" (as herein defined below). Employee
shall devote his best efforts and his full business time and attention to the
performance of the services defined by the by-laws of the company, services
customarily incident to such office and position and to such other services of a
senior Employee nature as may be reasonably assigned by the Chief Executive
Officer or requested by the Board of Directors (the "Board") of the Company
which may include services for one or more subsidiaries or affiliates of the
Company. Employee shall in his capacity as an employee of the Company be
responsible to and obey the reasonable and lawful directives of the Chief
Executive Officer and the Board of Directors of Hyperdynamics
Corporation.

    


                   (b)
Employee shall devote his full time (as defined below) and attention to such
duties, except for sick leave, periodic personal trips and vacations as
determined not to conflict with the material operations of the Company, and
excused leaves of absences otherwise. Employee shall use his best efforts during
the Term of Employment to protect, encourage, and promote the interests of the
Company.

    


    Full time
with respect to this agreement is understood to credit the Employee for his
on-call status with regard to managing employees located around the world and
recognizing that the Employee’s hours of specific work for the company are not
limited to any specific range of time during a work day but can be accomplished
around the clock and on weekends and/or holidays if deemed necessary by the
Chief Executive Officer or the  Employee himself, and certain
responsibilities of Employee’s responsibilities, as approved by the Chief
Executive Officer, may be done at any physical location including Employee’s
home.  As approved by the Chief Executive Officer, the company may
establish full home computer system and access communications capabilities for
Employee as deemed necessary by mutual agreement of the Chief Executive Officer
and Employee.  The principal duties of the employee are described in
Attachment A.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

                   (c)
Notwithstanding paragraph 2(b), Employee shall be entitled to sit as a director
on other boards of directors so long as doing so presents no conflicts of
interest with Employee's performance of his duties or his positions at the
Company, as determined and approved by the board of directors.

    


            3.     Compensation.

    


                   (a)
Base Salary. The Company shall pay to Employee during the Term of Employment a
minimum salary at the rate of two hundred thousand US dollars (US$200,000.00)
per year.  Such salary shall be payable Bi-Weekly, Semi-monthly, or
monthly in accordance with the Company's normal payroll procedures (Employee's
annual salary, as set forth above or as increased by action of the Company’s
Board of Directors from time to time, shall be referred to hereinafter as "Base
Salary"). At no time during the Term of Employment shall Employee's Base Salary
be decreased from the amount of Base Salary then in effect.

    


                   (b)
Performance Bonus. In addition to the compensation otherwise payable to Employee
pursuant to this Agreement, Employee shall be eligible to receive performance
bonus(es), as a cash sum in U.S. dollars, as determined and agreed to from time
to time by the Chief Executive Officer and the Board of Directors. The
performance bonus target shall be 50% with a maximum amount of 100%. The
performance targets and weightings are listed in Attachment B.

    


                   (c)
Long-Term Incentive/Stock Options. Effective the Effective Date, Employee will
receive five-year term options to purchase up to 200,000 shares of the common
stock of the Company.  These options are subject to the Company’s
Employee Stock and Stock Option plan.  One-third of such options shall
vest equally on each of the first, second and third anniversaries of the
Effective Date.  Effective the Effective Date, the Employee will also
receive five-year term options to purchase up to 200,000 shares with a 3-year
vesting period beginning if and when the Company’s share price attains a closing
market price of $3/share or more for five consecutive trading days (with vesting
equally on each of the first, second and third anniversaries of such date). The
strike price of both sets of options will be the share price at the close of
business on the trading date immediately preceding the Effective
Date.  A separate stock option agreement will be prepared setting
forth the option grants.

    


    (d) Relocation allowance/bonus:
Following execution of this agreement, the company will provide US$50,000 in
cash which is intended to cover expenses related to his relocation to Houston,
Texas.  Fifty percent (50%) of such relocation allowance/bonus will be
paid as part of the first payroll of January 2010, and the remaining 50% in the
first payroll of February 2010.

    


            4.     Benefits
During the Term of Employment:

    


                   (a)
Employee shall be eligible to participate in any life, health and long-term
disability insurance programs, pension and retirement programs, any 401 (k)
plans which may be put in place by the Company, stock option and other incentive
compensation programs, paid Company holidays and other fringe benefit programs
made available to senior employees of the Company from time to time, and
Employee shall be entitled to receive such other fringe benefits as may be
granted to him from time to time by the Company's Board of
Directors.

    


    
      
        
        

      

      
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                   (b)
Employee shall be allowed four (4) weeks of vacation with pay on the same
basis as other senior employees of the Company. Due to home locations on the
East Coast, USA, he will also be allowed at his discretion six four-day weekends
during a calendar year, notifying the company at least one week in advance of
each such weekend. Employee shall devote his full time and attention to his
duties, except for sick leave, and excused leaves of absences
otherwise.

    


                   (c)
The Company shall reimburse Employee for reasonable business expenses incurred
in performing Employee's duties and promoting the business of the Company,
including, but not limited to, reasonable entertainment expenses, travel and
lodging expenses, following presentation of documentation in accordance with the
Company's business expense reimbursement policies.

    


            5.
Term; Termination of Employment. As used herein, the phrase "Term of Employment"
shall mean the period commencing on the Effective Date and ending on the same
date three (3) years later; provided, however, that as of the expiration date of
each of (i) the initial Term of Employment and (ii) if applicable, any Renewal
Period (as defined below), the Term of Employment shall automatically be
extended for a one (1) year period (each a "Renewal Period") unless either the
Company or Employee provides Two (2) months' notice to the contrary.
Notwithstanding the foregoing, the Term of Employment shall expire on the first
to occur of the following:

    


                   (a)
Termination by the Company. Notwithstanding anything to the contrary in this
Agreement, whether express or implied, the Company may, at any time, terminate
Employee's employment for any reason other than Cause, Death or Disability by
giving Employee at least 60 days' prior written notice of the effective date of
termination. Company may terminate Employee's employment for Cause, Death or
Disability without prior notice, except that Employee may not be terminated for
substantial and willful failure to perform specific and lawful directives of the
Board, unless and until the Board has given him reasonable written notice of its
intended actions and specifically describing the alleged events, activities or
omissions giving rise thereto and with respect to those events, activities or
omissions for which a cure is possible, a reasonable opportunity to cure such
breach; and provided further, however, that for purposes of determining whether
Cause is present, no act or failure to act by Employee shall be considered
"willful" if done or omitted from being done by Employee in good faith and in
the reasonable belief that such act or omission was in the best interest of the
Company and/or required by applicable law.

    


            (b)
Termination by Employee. In the event that Employee's employment with the
Company is voluntarily terminated by Employee, the Company shall have no further
obligation hereunder from and after the effective date of termination. Employee
shall give the Company at least 30 days' advance written notice of his intention
to terminate his employment hereunder.

    


    
      
        
        

      

      
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            (c)
Salary, Benefits, and Severance Pay. Upon Termination. In the event of
termination of employment, Employee shall receive all regular Base Salary due up
to the date of termination, and if it has not previously been paid to Employee,
Employee shall be paid any Bonus to which Employee had become entitled under
Bonus(es) approved for Employee, prior to the effective date of such
termination. The Company shall have no further obligation hereunder from and
after the effective date of termination except as to policies put in place for
severance pay in certain situations where there is a termination not for cause
and the board approves such severance pay.

    


    Employee's
stock options with respect to the Company's stock shall be subject to the terms
of the Hyperdynamics’ Employee Stock and Stock Option Plan or any successor plan
and is a separate stock option agreement. In the event of termination,
Employee's rights to other benefits aside from severance shall be governed by
the terms of the Company's retirement, insurance and other benefit plans and
programs then in effect in accordance with the terms of such plans.

    


            6.     Confidential
Information, Non-Solicitation and Non-Competition.

    


                   (a)
During the Term of Employment and at all times thereafter, Employee shall not,
except as may be required to perform his duties hereunder or as required by
applicable law, disclose to others or use, whether directly or indirectly, any
Confidential Information regarding the Company. "Confidential Information" shall
mean information about the Company, its subsidiaries and affiliates, and their
respective properties that is not available to the general
public.  Employee agrees to sign a confidentiality agreement
reasonably requested by the Company.

    


            7.
Return of Company Documents: In the event Employee leaves the employment of
Company for whatever reason, Employee agrees to deliver to Company any and all
property situated on Company's premises and owned by Company including disks and
other storage media, filing cabinets or other work areas, is subject to
inspection by Company personnel at any time, with or without notice, for the
purpose of protecting Company's rights and interests in its intellectual
property.

    


            8.
Taxes. All payments to be made to Employee under this Agreement will be subject
to any applicable withholding of federal, state and local income and employment
taxes. Any withholding regarding exercise of stock options will be determined by
including an opinion of a third party tax attorney paid by the company as
pertaining to any withholding which may or may not be required.

    


            9.
Miscellaneous. This Agreement shall also be subject to the following
miscellaneous considerations:

    


                   (a)
Employee and the Company each represent and warrant to the other that he or it
has the authorization, power and right to deliver, execute, and fully perform
his or its obligations under this Agreement in accordance with its
terms.

    


                   (b)
This Agreement contains a complete statement of all the arrangements between the
parties with respect to Employee's employment by the Company, this Agreement
supersedes all prior and existing negotiations and agreements between the
parties concerning Employee's employment, and this Agreement can only be changed
or modified pursuant to a written instrument duly executed by each of the
parties hereto.

    


    
      
        
        

      

      
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                   (c)
If any provision of this Agreement or any portion thereof is declared invalid,
illegal, or incapable of being enforced by any court of competent jurisdiction,
the remainder of such provisions and all of the remaining provisions of this
Agreement shall continue in full force and effect.

    


                   (d)
This Agreement shall be governed by and construed in accordance with the
internal, domestic laws of the State of Texas.

    


                   (e)
Any rights of Employee hereunder shall be in addition to any rights Employee may
otherwise have under benefit plans, agreements, or arrangements of the Company
to which he is a party or in which he is a participant, including, but not
limited to, any Company-sponsored employee benefit plans. Provisions of this
Agreement shall not in any way abrogate Employee's rights under such other
plans, agreements, or arrangements.

    


                   (f)
For the purpose of this Agreement, notices and all other communications provided
for in this Agreement shall be in writing and shall be deemed to have been duly
given when delivered or mailed by United States certified or registered mail,
return receipt requested, postage prepaid, addressed to the named Employee at
the address set forth below under his signature; provided that all notices to
the Company shall be directed to the attention of the Board of Directors with a
copy to the Secretary of the Company, or to such other address as either party
may have furnished to the other in writing in accordance herewith, except that
notice of change of address shall be effective only upon receipt.

    


                   (g)
Section headings in this Agreement are included herein for convenience of
reference only and shall not constitute a part of this Agreement for any other
purpose.

    


                   (h)
Failure to insist upon strict compliance with any of the terms, covenants, or
conditions hereof shall not be deemed a waiver of such term, covenant, or
condition, nor shall any waiver or relinquishment of, or failure to insist upon
strict compliance with, any right or power hereunder at any one or more times be
deemed a waiver or relinquishment of such right or power at any other time or
times.

    


                   (i)
This Agreement may be executed in several counterparts, each of which shall be
deemed to be an original but all of which together will constitute one and the
same instrument.

    


    (j) For the avoidance of doubt, the
Employee represents, covenants and warranties that his employment by the
Employer will not breach any confidentiality agreements, non-competition
agreements or non-solicitation agreements that the Executive may entered into
with others.

    


            10.
Survival of Provisions: The executory provisions of this Agreement will survive
the termination of this Agreement.

    


    
      
        
        

      

      
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            IN
WITNESS WHEREOF, the parties hereto have executed this Agreement as

    of the
day and year first above written.

     

    
      
        	EMPLOYEE	 	 	COMPANY	 
	 	 	 	 	 
	 	 	 	HYPERDYNAMICS
      CORPORATION	 
	 	 	 	 	 
	
                BY:
      /s/ William A. Young

              	 	 	
                BY:
      /s/ Ray Leonard

              	 
	
                WILLIAM
      A. YOUNG

              	 	 	
                RAY LEONARD

              	 
	
                TITLE:

              	 	 	
                TITLE:

              	 
	EXECUTIVE
      VICE PRESIDENT	 	 	CHIEF
      EXECUTIVE OFFICER	 
	COMMERCIAL
      AFFAIRS	 	 	 	 
	 	 	 	 	 
	ADDRESS:	 	 	ADDRESS:	 
	 	 	 	One
      Sugar Creek Center Boulevard	 
	 	 	 	Suite
      125	 
	 	 	 	Sugar
      Land, Texas 77478